SAMPADA CHEMICALS LTD, MUMBAI V. DCIT CC 3(3), MUMBAI

ITA 3773/MUM/2016

• Counselvise Citation: [2017] 126 COUNSELVISE.COM (IT) 8714 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 4 month(s) 23 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 25-10-2017
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: Not Allotted
• Assessment Year: 2011-2012
• Appeal Filed On: 01-06-2016
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: R P MEENA
• Keywords: Opportunity of being heard
• Section: 144

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCH A, MUMBAI BEFORE SHRI G.S. PANNU, ACCOUNTANT MEMBER AND SHRI RAM LAL NEGI , JUDICIAL MEMBER ITA NO. 3773/MUM/2016 : A.Y : 2011 - 12 SAMPADA CHEMICALS LIMITED 60, 3 RD FLOOR, JARIWALA BUILDING, SANE GURUJI MARG, TARDEO, MUMBAI 400 034 (APPELLANT) PAN : AACCS7980C VS. DCIT, CENTRAL CIRCLE - 3(3), MUMBAI (RESPONDENT) APPELLANT BY : NONE RESPONDENT BY : SHRI R.P. MEENA (CIT - DR) DATE OF HEARING : 25/10/2017 DATE OF PRONOUNCEMENT : 25/10/2017 O R D E R PER G.S. PANNU , AM : THE CAPTIONED APPEAL BY THE ASSESSEE IS DIRECTED AGAINST THE ORDER OF CIT(A) - 51 , MUMBAI DATED 15.02.2016 , PERTAINING TO THE ASSESSMENT YEAR 2011 - 12 , WHICH IN TURN HAS ARISEN FROM THE ORDER PASSED BY THE ASSESSING OFFICER, MUMBAI DATED 28.03.2014 UNDER SECTION 144 OF THE INCOME TAX ACT, 1961 (IN SHORT THE ACT). 2. IN ITS APPEAL, ASSESSEE HAS RAISED THE FOLLOWING GROUNDS OF APPEAL: - 1. THAT ON THE FACTS AND CIRCUMSTANCES OF THE CASE, THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS) ERRED IN CONFIRMING THE ASSESSMENT ORDER PASSED U/S 144 BY ACIT. THE HEARING WAS FIXED BY CIT (APPEALS) 51 ON 2 SAMPADA CHEMICALS LTD. ITA NO. 3773/MUM/2016 4 TH FEBRUARY, 2016 AND THE APPELLANT COULD NOT ATTEND ON THE APPOINTED DAY AS THERE WAS SURVEY & SEARCH OPERATION ON THE PREMISES OF THE APPELLANT ON 04 TH FEBRUARY, 2016. 2. THAT ON THE FACTS AND CIRCUMSTANCES OF THE CASE, THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS) ERRED IN CONFIRMING ADDITION O F RS.105,359,146/ - BEING DISALLOWANCE @ 35% ON ACCOUNT OUT OF TOTAL PURCHASES OF RS.301,026,134/ - BY THE APPELLANT. 3. THAT ON THE FACTS AND CIRCUMSTANCES OF THE CASE, THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS) ERRED IN CONFIRMING ADDITION OF RS.278 ,9250/ - BEING DISALLOWANCE @ 10% ON ACCOUNT EXPENDITURE OUT OF TOTAL ADMINISTRATIVE EXPENSES AND PROVISIONS OF RS.2,789,247/ - ON ADHOC BASIS. 3. AT THE TIME OF HEARING, IT WAS NOTED THAT INSPITE OF ISSUANCE OF NOTICE OF HEARING, NONE APPEARED ON BEHALF OF THE ASSESSEE NOR ANY APPLICATION FOR ADJOURNMENT HAS BEEN MOVED ON BEHALF OF THE ASSESSEE AND, THEREFORE, IN VIEW OF RULE 24 OF THE INCOME TAX (APPELLATE TRIBUNAL) RULES, 1963, THE APPEAL OF THE ASSESSEE IS BEING DISPOSED OFF EX - PARTE THE APPELLANT - ASSE SSEE AFTER HEARING THE RESPONDENT - REVENUE ON MERITS. 4. AFTER PERUSING THE ORDER OF THE CIT(A), IT WAS PUT FORTH TO THE LD. CIT - DR AS TO HOW THE ORDER PASSED BY THE CIT(A) MEETS WITH THE REQUIREMENTS OF SEC. 250(6) OF THE ACT. NOTABLY, SEC. 250(6) OF THE ACT OBLIGATES THE CIT(A) TO DISPOSE OFF THE APPEAL IN WRITING BY STATING THE POINTS FOR DETERMINATION, THE DECISION THEREON AND THE REASONS FOR THE DECISION. HOWEVER, IN THE INSTANT CASE, THE CIT(A) MERELY NOTED THE ABSENCE OF THE ASSESSEE ON THE APPOINT ED DATE OF HEARING AND HAS DISMISSED THE APPEAL IN LIMINE WITHOUT APPROPRIATELY CULLING OUT THE DISPUTE S RAISED BEFORE HIM AND HIS DECISION THEREON. DISMISSAL OF AN 3 SAMPADA CHEMICALS LTD. ITA NO. 3773/MUM/2016 APPEAL WITHOUT GOING INTO THE MERITS OF THE ISSUES RAISED DOES NOT ADVANCE ANY PURPOSE INASMUCH AS THE HIGHER APPELLATE AUTHORITY WOULD NOT BE ABLE TO PROCEED EFFECTIVELY. THUS, ON THIS ASPECT ITSELF, IN OUR VIEW, THE ORDER OF THE CIT(A) IS UNSUSTAINABLE AND THE MATTER DESERVES TO BE REMANDED BACK TO HIS FILE FOR A DE NOVO ADJUDICATION IN ACCORDANCE WITH LAW. APART THEREFROM, THE GROUND OF APPEAL NO. 1 RAISED BY THE ASSESSEE CONTAINS AN AVERMENT THAT THE APPEARANCE COULD NOT BE MADE ON THE APPOINTED DATE OF HEARING BEFORE THE CIT(A) AS A SEARCH AND SURVEY ACTION TOOK PLACE ON THE ASSESSEE ON THE SAME DAY. BE THAT AS IT MAY, SINCE WE HAVE ALREADY DECIDED TO REMAND THE MATTER BACK TO THE FILE OF CIT(A) FOR THE REASONS DISCUSSED ABOVE, WE DO NOT FIND IT APPR OPRIATE TO GO INTO THIS ASPECT OF THE MATTER. NEEDLESS TO SAY, OUR DECISION TO REMAND THE APPEAL BACK TO THE FILE OF THE CIT(A) FOR ADJUDICATION DE NOVO SHALL NOT BE CONSTRUED AS ANY REFLECTION ON THE MERITS OF THE ISSUES THAT MAY BE RAISED BEFORE THE CIT (A). THE CIT(A) SHALL ALLOW THE ASSESSEE A REASONABLE OPPORTUNITY OF BEING HEARD AND ONLY THEREAFTER ADJUDICATE THE APPEAL, AS PER LAW. 5. IN THE RESULT, APPEAL OF THE ASSESSEE IS ALLOWED, AS ABOVE. THE ABOVE DECISION WAS PRONOUNCED IN THE OPEN COURT AF TER HEARING THE LD. DR AT THE CONCLUSION OF THE HEARING ON 25 TH OCTOBER, 2017. SD/ - SD/ - (RAM LAL NEGI) JUDICIAL MEMBER (G.S. PANNU) ACCOUNTANT MEMBER MUMBAI, DATE : 2 5 T H OCTOBER, 2017 *SSL* 4 SAMPADA CHEMICALS LTD. ITA NO. 3773/MUM/2016 COPY TO : 1) THE APPELLANT 2) THE RESPONDENT 3) THE CIT(A) CONCERNED 4) THE CIT CONCERNED 5) THE D.R, A BENCH, MUMBAI 6) GUARD FILE BY ORDER DY./ASSTT. REGISTRAR I.T.A.T, MUMBAI